2019 Black Friday & Q4 Facebook Ad Playbook: 5 Tips to Stay Efficient When Costs Rise

How marketers can shift their Facebook ad strategy to align with the holiday shopping season

The holiday shopping season is upon us. For advertisers, the fourth quarter and particularly the week surrounding Black Friday is unlike any other time of the year. Ad costs typically spike by 25% or more, and the competition for quality inventory is fierce.

Ecommerce advertisers are managing their boom time, while other advertisers—such as mobile games and apps—are hoping to just close the year strong.

Late fourth quarter is the busiest time of the year for retailers, and Facebook advertising gets particularly competitive from October through Dec. 23. But even though Facebook ad prices spike late in the fourth quarter, it’s still the best platform in town. Most major advertisers will be bidding aggressively.

Even with the inflated prices, most ecommerce advertisers do well. A recent study from Shopify Plus showed that ecommerce marketers say Facebook ads are the most effective channel for new customer acquisition during the holidays.

Of course, it’s no surprise that each year ads get more expensive around Black Friday, Cyber Monday and all the December holidays. Every advertiser knows this. They just go into the season with a brave face anyway, ready to bid high to hit their annual targets. Anybody who’s ever looked at a Facebook Ads dashboard during the holidays has had to swallow a lump of coal when they looked at their cost per click. And sure enough, 80% of ecommerce marketers say rising ad spend is a concern for holiday marketing.

Despite the expense and the competition, Q4 is a massive opportunity. For retailers, it’s an opportunity to maximize the best buying season of the year. For mobile games and apps, the holidays precede the most cost-efficient advertising season of the year and what will be the lowest cost per thousand impressions of 2020.

To help you navigate the season, here are five Facebook advertising best practices for late Q4:

1. Manage Strategy Shifts in the Ad Spend Wave

Done right, the ramp-up to holiday advertising can be as important as the holidays themselves. Advertisers can leverage retargeting, email lists and other more cost-effective channels after Dec. 8—if they’ve scaled up their campaigns properly beforehand.

But don’t underestimate the after-Christmas shopping boom. Everybody likes to splurge with their Christmas money and buy themselves what Santa didn’t bring. That’s why the period after Dec. 26 can be especially effective. Take this time to test out new device ads, video and new messaging and creative—and don’t stop until Jan. 15 or even Valentine’s Day. Many traditional advertisers pull back their advertising at the beginning of the year, leaving another nice window of opportunity for the rest of us.

2. Increase Average Order Size

When user acquisition costs rise, you have two choices for preserving profits: cut your overhead and product costs, or increase average order size. Fortunately, increasing average order size complements what’s going on in Q4 nicely: people are spending more on themselves and others.

There are plenty of ways to increase average order size:

• Bundling products.
• Offering extra features for a discount.
• Using dollar-off discounts (“spend $X, get $X off”).

You may also want to just skip this average order size strategy entirely, too. Depending on your company and your situation, it could make sense to just go with a loss leader in Q4 and use it to build your customer base.

If you manage the loss-leader strategy well, you could break even (or make a very slim profit), but you’ll add a ton of people to your buyers list. Pair that with effective retention marketing, and Christmas could be a nice opportunity to just find as many new customers as you can.

3. Wait It Out or Find Pockets of Efficiency

Not everybody is in ecommerce. If you engage in app marketing or lead generation, the holidays present a very different problem.

For non-ecommerce Facebook advertisers, the best time to scale spend during the fourth quarter is between Oct. 1 through Thanksgiving. CPMs increase during that time, but not too much. Then pull back or shift spend between Nov. 28 through Dec. 10.

Here are some other suggestions to help you combat rising prices during peak CPM cost increases:

For budgeting:

• If you’re going to spend money in the fourth quarter and you’re not an ecommerce company, try to frontload spend as much as possible in October and November.

For audience targeting:

• Focus on less competitive markets during high demand periods.
• Allocate more budget to Android. It tends to see a less pronounced increase in prices.
• Leverage data from international campaigns to scale up in Europe, the Middle East, Africa, Asia-Pacific and Latin America where holiday competition is not as intense.

For bidding:

• Use value optimization to scale up in global markets, while simultaneously optimizing for the lowest cost per purchase, which can preserve return on advertising spend (ROAS) while making the expansion work.
• Facebook research for its new Structure for Scale (S4S) framework has shown that ad set delivery stabilizes when an ad set achieves at least 50 unique conversions per week. Facebook found a direct correlation between ad sets that achieve this volume, reduced cost per action and stronger ROAS. Occasionally the ROAS improvement can exceed 25%.
• Start small with minimum ROAS bidding, but use it. Minimum ROAS bidding allows advertisers to input their desired return on ad spend for each ad set. You can set a minimum ROAS with a number greater than 0.01%, then Facebook will stop delivering your ad if they can’t hit that specified percentage. It works best if you start by testing a low ROAS goal (less than 1%) against a broad audience, then inch up incrementally if performance is not there (1%, 2%, etc). Don’t start high and scale it back; minimum ROAS works better when incrementally increased.
• Use app event optimization for purchase manual bids. If you’re experiencing under-delivery or lower-quality conversions with autobid, consider switching to highly competitive smart bids (the lowest cost with bid cap). With unpredictable bid conditions during the holidays, smart bids are a good way to maintain a stable delivery.

For creative:

• Plan for more frequent creative refreshes to fight creative fatigue. You’ll probably have to plan ahead of time for this, as most employees want at least some time off around the holidays. Or, if necessary, look to a creative partner to expand capacity.
• Develop holiday-themed creative to increase relevance scores. This can help reduce some of the higher costs of holiday ads.
• Test playable ads on the audience network to drive more engaged, high-quality installs. Facebook says these ads are getting the best performance of any ad format right now.

Fortunately, the expensive days do pass. Almost like magic, on Dec. 26, costs drop. Most of the ecommerce marketers have spent their budgets, sold their inventory, and consider the year done.

This is when non-ecommerce marketers—such as games and mobile apps—have their heyday. They will enjoy some of the most efficient CPMs of the year from Dec. 26 through Valentine’s Day.

Take advantage of the drop in CPIs and influx inventory during this period by using “auction sales.” After Christmas is also a great time to target new device users, and device-specific creative can often get you an extra bump in relevance. Of course, if you want to dominate the bidding during these magic days, you’ll have to have set aside some budget ahead of time.

4. Focus on Mobile

Everybody knows mobile traffic now exceeds desktop traffic. But many marketers still believe “mobile traffic doesn’t convert”—or at least that it doesn’t convert as well as desktop traffic.

That might no longer be true.

A study of Google Shopping ads revealed a dramatic increase in mobile conversion rates in the last few years. The conversion rates for shoppers who begin and end their buyer’s journeys on mobile devices has increased by 252%.

According to the report: “The path of shoppers starting their search on desktop and completing their purchase on mobile rose 259% year over year.” In other words, some people prefer to check out via mobile rather than on a desktop.

Of course, that’s Google Shopping, not Facebook ads. But Facebook did its own research. They also found that mobile users have become mobile shoppers.

5. Use Video

If you’ve been hanging back from investing in video or investing more into video, it might be the edge you need for Q4 2019.

According to Facebook research, “Nearly 1 in 3 mobile shoppers surveyed in the U.S. said that video is the best medium for discovering new products.” So, if you want to get more buyers, make more videos for Facebook and Instagram.

And yes, Virginia, there is still enough time to get videos made before the major shopping holidays.